[News] TSMC’s Capital Expenditure Expected to Remain Unchanged This Year Ahead of Earnings Call

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At TSMC’s upcoming earnings call on Thursday (October 17th), capital expenditure has become one of the key points of interest for the market. According to a report from Economic Daily News, institutional investors believe that TSMC’s capital expenditure range this year will remain unchanged. While next year’s capital expenditure plan will be announced at the next earnings call in January, it is suggested that capital expenditures for 2025 will increase compared to this year.

TSMC is currently in the quiet period before earnings call. According to the report from Economic Daily News, institutional investors point out that TSMC’s focus on 2nm-related mass production plan could significantly boost subsequent capital expenditures.

It is estimated that in 2025, TSMC’s capital expenditure will reach USD 32 billion to USD 36 billion, making it the second highest in history, with an annual growth rate of approximately 20%. TSMC’s increase in capital expenditure will significantly benefit ASML, Applied Materials, and related suppliers in Taiwan, the report noted.

In the earnings call in July, TSMC mentions that, to meet the customer demand, this year’s expected capital expenditure range will be narrowed. The original forecast in April was between USD 28 billion and USD 32 billion, which was adjusted to a range of USD 30 billion to USD 32 billion in July.

As for TSMC’s capital expenditures in the past, the historical high occurred in 2022, when it reached a record of USD 36.29 billion. In contrast, TSMC’s actual capital expenditure for 2023 is USD 30.45 billion, falling below the lower bound of the expected USD 32 billion set by the company during the October 2023 earnings call. This shortfall has sparked discussions in the market at that time.

Previously, sources indicated that TSMC has invested heavily in research and development related to advanced 2nm processes. The demand for 2nm technology is stronger than anticipated, and there are indications that production capacity planning will also include expansions in the Southern Taiwan Science Park, as suggested by the report from Economic Daily News.

According to the report, TSMC’s 2nm capacity expansion is expected to encompass four phases in Hsinchu Science Park and Baoshan, along with Phase 2 in Kaohsiung. If the plans for the Southern Taiwan Science Park come to fruition, TSMC’s 2nm technology could achieve a total of at least eight phases and eight fabs of production capacity.

Read more

• [News] Preview for TSMC’s Key 3nm Clients ahead of Earnings Call: Order Surge Expected in 2025
• [News] TSMC’s Newly Acquired AP8 Facility in Southern Taiwan Rumored to Start Production in 2H25
• [News] TSMC Took Another Step in Advanced Process Expansion

(Photo credit: TSMC)